Friday, January 30, 2009

DJIA and S&P 500 Suffer Their Worst January Ever

All 3 major indices declined on the day and the week. The Dow Jones Industrial Average (DJIA) and the S&P 500 Index both suffered their worst January on record. For the month, the DJIA lost 775.53 points (8.837%) while the broader S&P 500 lost 77.37 points (8.566%).

For the week, the DJIA lost 76.70 points (-0.95%), the NASDAQ Composite Index declined by 0.87 point (-0.059%), and the S and P 500 Index lost 6.07 points (-0.73%).

Gross Domestic Product (GDP) "Advance" Released Today for Q4, 2008

U.S. Gross Domestic Product (GDP) numbers for the fourth quarter of 2008 were released this morning by the Commerce Department's Bureau of Economic Analysis:

Predicted: -5.4%Actual: -3.8%

The above percentages represent the quarter-to-quarter change in the Gross Domestic Product for the United States. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

The GDP is the broadest measure of economic activity in the entire United States, covering all sectors of the economy.

The "advance" estimates are based on data that are incomplete or subject to future revision. Next month, the Commerce Department will release a "preliminary" report for the above-referenced quarter, which will contain more accurate data. A "final" GDP report will be released later this year, which will contain the most accurate and authoritative data on the above-referenced quarter.

Thursday, January 29, 2009

Durable Goods Orders Report for December 2008 Released Today

The Durable Goods Orders report for December 2008 was released this morning:

Predicted: -2.0%Actual: -2.6%

The above percentages represent the month-to-month change in orders for durable or hard goods for immediate or future delivery from U.S. manufacturers. Examples of durable goods: cars, airplanes, computers -- items that are built to last 3+ years.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure. The Durable Goods Orders report is produced by the Commerce Department.

Compiled jointly by the U.S. Commerce Department and the U.S. Department of Housing and Urban Development, the monthly New Home Sales report measures the number of newly-built homes with committed buyers for a given month.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

The New Home Sales report is watched by economists and investors because it offers insight into the state of the U.S. housing market, and also provides data that can be used to predict sales of large household furniture and appliances like refrigerators, air conditioners and microwave ovens.

New Unemployment Insurance Claims for The Week of January 24, 2009

Earlier today, the Labor Department released the New Unemployment Insurance Claims report for the week that ended on January 24, 2009:

Predicted: 575,000Actual: 588,000

The above figures represent the number of first-time claims for unemployment benefits for the entire United States. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Tuesday, January 27, 2009

Consumer Confidence Index (CCI) for January 2009

The Consumer Confidence Index (CCI) for this month (January 2009) was released by The Conference Board this morning:

Predicted: 39.0Actual: 37.7

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Every month, The Conference Board sends a questionnaire to 5,000 U.S. households. Survey participants are polled about their feelings regarding the U.S. economy, current and future, and about their own fiscal circumstances. On average, 3,500 participants complete and return the 5-question survey.

The baseline "100" score for the CCI is linked to 1985 survey data.

When consumers feel good about the economy, they tend to do more spending, and vice versa.

Based in New York City, The Conference Board is a private, not-for-profit organization with a mission to, "create and disseminate knowledge about management and the marketplace to help businesses strengthen their performance and better serve society."

Monday, January 26, 2009

Existing Home Sales for December 2008

The Existing Home Sales report for December 2008 was released by The National Association of Realtors® this morning:

Predicted: 4,400,000Actual: 4,740,000Change from One Month Previous: +6.5%Change from One Year Previous: -3.5%

The "actual" figure above represents the preliminary, seasonally adjusted annual sales count of existing homes, co-ops and condominiums for last month. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Median Price for A Preowned, Single-FamilyHome In December 2008: $175,400Change from One Year Previous: -15.3%Average Price for A Preowned, Single-FamilyHome In December 2008: $216,000Change from One Year Previous: -15.0%

Leading Economic Indicators for December 2008

The Conference Board report on the nation's Leading Economic Indicators for December 2008 was released this morning:

Predicted: -0.3%

Actual: +0.3%

The above numbers represent the month-to-month change for the nation's leading economic indicators. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

The Leading Economic Indicators Index is a composite of 10 of the nation's economic data releases that's put together by The Conference Board. Statistically, the components listed below have shown a significant increase or decrease before national economic upturns or downturns, respectively:

Friday, January 23, 2009

All 3 Majors Lost More Than 2% On The Week

Each of the 3 major indices lost more than 2% on the week. For the week, crude oil for future delivery advanced by $9.96 (27.28%) to finish at $46.47 per barrel in New York, despite a marked increase in U.S. stockpiles.

For the week, the DJIA lost 203.66 points (-2.459%), the NASDAQ Composite Index declined by 52.04 points (-3.403%), and the S and P 500 Index lost 18.17 points (-2.137%).

New Unemployment Insurance Claims for The Week of January 17, 2009

Earlier today, the Labor Department released the New Unemployment Insurance Claims report for the week that ended on January 17, 2009:

Predicted: 610,000Actual: 589,000

The above figures represent the number of first-time claims for unemployment benefits for the entire United States. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Housing Starts During December 2008

The U.S. Commerce Department this morning released the Housing Starts report for December 2008:

Housing Starts:Predicted: 615,000Actual: 550,000Change From Previous Month: -15.5%Change From One Year Previous: -45.0%

Building Permits:Actual: 549,000Change From Previous Month:: -10.7%Change From One Year Previous: -50.6%

The above is a measure of initial construction of single and multi-family residential units in The United States for last month. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

If you're wondering about the demand for new homes in the United States, or about the American construction industry in general, then you should pay attention to the monthly Housing Starts report. The monthly Housing Starts report also offers insight into specific types of consumer spending: when housing starts are up, demand for the stuff that a consumer would purchase for a new home (large appliances, consumer electronics, furniture, etc.) tends to also rise--and vice versa.

Consumer Sentiment for January 2009

The Consumer Sentiment figure for this month (January 2009):

Predicted: 59.0Actual: 61.9

The Consumer Sentiment Index is compiled on a monthly basis by the University of Michigan; 500 U.S. households are queried about their own financial circumstances and about the economy in general. 200 questions are asked, e.g. "Do you think that right now is a good time to purchase a major household item, like a new microwave oven, TV set, or a new sofa?"

The Consumer Sentiment Index uses a 1966 baseline, i.e. for 1966, the Consumer Sentiment Index = 100. So any number that is below the 1966 baseline of 100 means that the folks who were polled recently aren't as optimistic about the U.S. economy as the sample that was polled back in 1966.

The Consumer Sentiment Index is similar to the Consumer Confidence Index in that they both measure consumer attitudes and offer insight into consumer spending.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Consumer Price Index (CPI) for December 2008

Earlier this morning, the Labor Department's Bureau of Labor Statistics released the Consumer Price Index (CPI) for December 2008:

Predicted: -0.9%Actual: -0.7%

Below is the CPI when food and energy are subtracted from the equation, also known as the "core CPI":

Predicted: +0.1%Actual: 0.0%

The above numbers represent the seasonally adjusted, month-to-month change in prices for a specific group of goods and services that consumers buy, and is, therefore, a very important part of the overall inflation picture for the country.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

--------------------------------------------------------

The CPI figure for December 2008: 210.228 (not seasonally adjusted)

Change from 12/2007 through 12/2008: +0.1%

The baseline 100 score is pegged to 1982-1984 data. In other words, in general, consumer prices have more than doubled since the early 80's.

Thursday, January 15, 2009

Philadelphia Fed Business Outlook Survey for January 2009

Earlier today, the Federal Reserve Bank of Philadelphia released its diffuse index of current manufacturing conditions for this month (January):

Predicted: -35.0Actual: -24.3

The "actual" figure above is an index of current manufacturing conditions within the Federal Reserve's Third District, which includes eastern Pennsylvania, all of Delaware and the southern half of New Jersey. Any figure below zero implies that manufacturing in the region is contracting, and vice versa.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

New Unemployment Insurance Claims for The Week of January 10, 2009

Earlier today, the Labor Department released the New Unemployment Insurance Claims report for the week that ended on January 10, 2009:

Predicted: 500,000Actual: 524,000

The above figures represent the number of first-time claims for unemployment benefits for the entire United States. The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Producer Price Index (PPI) for December 2008

The Producer Price Index (PPI) for December 2008 was released this morning:

Predicted: -2.0%Actual:-1.9%

Below is the PPI when food and energy are subtracted from the equation, also known as the "core PPI":

Predicted: +0.1%Actual:+0.2%

The above numbers represent the month-to-month change in prices for a specific group of goods and capital equipment that producers buy in order to produce finished goods for consumers. The PPI is an important part of the overall inflation picture for the country because when costs go up for producers, producers will often pass those increased costs on to consumers.

The PPI is released by the Department of Labor's Bureau of Labor Statistics.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

Friday, January 09, 2009

All 3 Majors Lost More Than Three Percent On The Week

Each of the 3 major indices lost more than 3% on the week as a diverse group of companies including Alcoa, Walgreens and EMC Corp. announced job cuts. The Labor Department reported that nonfarm payrolls shrank by 524,000 last month while the unemployment rate jumped to 7.2%. Crude oil for future delivery finished the week at $40.83 per barrel in New York.

For the week, the DJIA lost 435.51 points (-4.82%), the NASDAQ Composite Index declined by 60.62 points (-3.714%), and the S and P 500 Index lost 41.45 points (-4.448%).

Economist, academics, central bankers and investors pay very close attention to the monthly Employment Situation report as it offers penetrating insight as to the current and near-future state of the overall U.S. economy. If a) Americans are earning more money, b) unemployment is low and c) the economy is creating new jobs, this typically translates to more money being pumped into the economy (and vice versa.)

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

ISM Manufacturing Index for December 2008

Earlier today, the Institute for Supply Management (ISM) released their Purchasing Manager's Index (PMI) for December 2008:

Predicted: 35.5%Actual: 32.4%

Every month, the ISM surveys purchasing and supply executives at hundreds of companies across the country that are involved in manufacturing in some form. The resulting index is watched closely by academics, economists and investors because manufacturing accounts for 12% of U.S. Gross Domestic Product (GDP).

The PMI is a reliable barometer of U.S. manufacturing: A PMI above 50% implies that U.S. manufacturing expanded during the month in question; when it's below 50%, it implies that the manufacturing sector contracted.

The "predicted" figure is what economists and Wall Street forecasters were expecting, while the "actual" is the true or real figure.

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